Skip Navigation
 

Apologies

This page is quite old hence its rather spartan appearance.

Why not check out our Latest Stories page for our newest articles or search our site for anything.

SPECIALS
What To Do In A Falling Market

By The Motley Fool Staff
September 21, 2001

Whenever a major world event occurs, it's natural for investors to ask how it will impact the economy and their own personal financial situation. After all, financial markets abhor disruption and uncertainty.

What should investors do in the wake of the terrorist disasters in New York and Washington? Our first answer would be to gain perspective. Not to diminish what's happened, but non-financial tragedies have shaken financial markets before.

There have been wars and war scares before. And each time in the last 100 years, stock markets have emerged stronger and more successful. That may seem like wishful thinking right now, but it's true: Major non-financial events, however tragic or devastating, historically have only a short-term effect on the financial markets.     

While the US military currently gears up for battle, remember legendary US investor Philip Fisher and his thoughts on wars and war scares, penned around 1960: "...whenever American forces have become involved in any fighting whatever, the American stock market has always plunged sharply downward.... Nevertheless, at the conclusion of all actual fighting -- regardless of whether it was World War I, World War II, or Korea -- most stocks were selling at levels vastly higher than prevailed before there was any thought of war at all."

About war scares, he added: "Furthermore, at least ten times in the last twenty-two years, news has come of other international crises which gave the threat of major war. In every instance, stocks dipped sharply on the fear of war and rebounded sharply as the war scare subsided."     

Fisher's thoughts still apply today. Bottom line? Don't panic and sell your stocks on the basis of recent events. It could even be time to buy. The Motley Fool offers the following resources to help you gain perspective.

Should We Reassess Our Foolish Principles?
We've all had time to reflect on what's happened recently and speculate on how it will impact upon our lives in the future. Like it or not, consideration of financial matters is one of the things we need to look at. So do any of the fundamental tenets about our finances need re-evaluation?

What to Do In A Falling Market
Making money on the stock market can be easy, especially if you have the patience to allow your investments to grow and mature. But when stock markets take an unexpected turn for the worse, what should investors do?

Shares Continue To Outperform All Other Investments Steadily Over The Long Term
The Foolish truth of the matter is that successful investment is a case of being calm, patient and perhaps even a little boring. You have to try to ignore the fact that just about everyone in the media, and certainly all the brokers, are trying to whip everybody up into some mad market frenzy.

Why You Should Invest
With the stock market flying all over the place, the answer is to keep calm, relax, and have a nice cup of tea. You should be invested for the long term, and over the long term, equities have been the best form of investment.

Prepare Your Portfolio For Troubled Times
According to the doom-mongers, of which there are plenty these days, war and recession is nearly upon us. So how should stock pickers prepare for the dark days that could lie ahead?

Don't Take Bull From Bears
Here are five phrases that market commentators never tire of repeating these days -- and why Foolish investors should ignore every one of them.

Timing The Market
No one knows where the stock market is going next. And you can't time the market. But shares still make good long-term investments.

Don't' Be Afraid Of Buying On A War Scare
War -- what is it good for? Well, according to legendary investor Philip Fisher, it's good for buying shares.

How Low Can The Market Go?
The FTSE 100 is in freefall. But rather than judging the market bottom, investors should use their time in a more constructive manner.

Don't Panic! Don't Panic!
Look out of the window. Although the stock market is falling, people are still milling about, cars are still moving, trains are still running and there is food in the shops. Don't panic!

Why Buy and Hold Is Best
Bear markets offer great opportunities for Foolish investors. While most other investors are busy selling their shares, hoping to get out before things get even worse, a Foolish investor can continue to concentrate on the long term and benefit from the market weakness.

Three Cheers For Mr Market!
It's simple really. Market declines are great opportunities to top-up on your favourite long-term holdings at bargain prices. In these volatile times, remember Warren Buffett.

Uncertainty? So What's New?
Everyone's talking about uncertainty these days. But the future is always uncertain. As before, long-term investors should continue to hunt for great companies at attractive prices.

Lessons From The Last Bear Market
Just as bears never pre-announce their entrance, nor do they notify you when they are about to take their leave. The secret, then, is to stay invested, or if you haven't invested already, start now!

Markets Reward the Patient Investor
This is the time when we need to summon up our ability to weather the stock market pain. We should remember the stock market has an uncanny knack of staging recoveries when we least expect it, and this will reward those invested through good times and the bad.

Chop and Change? No Thanks!
A strategy is your way of managing your entire investing career. As such, it must be designed to handle both bull markets and bear markets. It's no good having a long-term strategy that works "just as long as a bear market doesn't come along".

The 1998 Market Crash Survival Guide
Remember 1998? Russia was crumbling, the rouble was collapsing and Boris Yeltsin was resigning. Global stock markets plummeted, but as always, investors saw it through.